The Changing nature of the Italian Gaming Landscape

20 February 2018

United Kingdom

Charlie Allen

Glory Global

Nestled between the Tuscan hills and beach at Forte dei Marmi, the harbour from where Michelangelo shipped his marble in the Renaissance, sits the head office of V.N.E SRL, neatly sandwiched between olive groves to the East and the Genova to Pisa rail road to the West.

VNE is a highly valued, long standing Glory OEM customer. Its success since it was established in the 1970s by Nino Verona has been linked to the, once, seemingly inexorable and insatiable demand for slot machines and video lottery terminals. Lorenzo Verona, General Manager and son of Nino explained that he has supplied at least 20 000 units of his King Change machines to the betting and casino industry but, he bemoans, that times are a changing. Today, gaming still accounts for 90% of his entire business with the balance derived from retail, vending, laundry, parking and deposit solutions and he is nervous about what could be around the corner.

Recognising that VNE needs OEM solutions to position itself effectively in international markets. A strategy planning day was arranged by Zara Thomas, Glory OEM Regional Sales Manager, to examine opportunities more closely and assess which of our products would give VNE the edge and why. For example, Glory’s NMD100 has been successfully integrated in their Royal Cash change machine installed in Finland.

Though the Italian gaming industry and its supply chain is massive – 5000 state run betting shops “Scommesse SNAI”, 3000 VLT games rooms, 100000 bars, 250000 employees, 6000 suppliers – the market is now mature and, if anything, declining due to the fear of growing health concerns, legislation, political uncertainty and, similarly in the UK, a trend towards lower unit stakes, jackpot sizes and the migration to online gaming.

Looking as this risk more closely only 0.03% of Italian gamers are formally recognised as addicts. However, in the UK, the anecdotal evidence suggests a more widespread, unreported problem of many more than this, getting hooked on these machines dubbed the “crack cocaine” of the betting industry especially in lower-income brackets. It’s the health angle which is fuelling the drive for legislative change on a regional basis, where local lawmakers in Italy have the power to legislate and make changes to national law.

The risks to VNE and the entire supply chain are clear. It’s a high-stake game of poker right now, the flop has been revealed but everything will be determined by the river card to be revealed on March 4th 2018, when Italy goes to the election ballot box. The outcome is binary – industry and the majority favour Berlusconi’s Forza Italia – if successful, and the polls make him the favourite right now. The rest of the country favour Movimento 5 Stelle (MVS or Five Star Party) in which scenario, according to Lorenzo, if MVS comes to power on the March 4th then the gaming industry, such as we know it today in Italy, could be dead within a couple of years

In the UK it is possible to gamble up to £300 in a minute on Video Gaming machines with the maximum stake set at £50. In Italy the maximum is €10 for a VLT and €1 for a slot. Slot machines are already banned in Piedmont (Turin region) and Lorenzo is concerned that, one by one, the other 19 regions might follow suit.

The transition might take up to two years in this Armageddon scenario for VNE so Lorenzo and his team are exporting to Spain and have identified opportunities in both Central and Latin America. VNE has recently been awarded its licence to supply and operate machines in Nevadaby the Gaming Board of Control.

It’s too soon to sound the death knell for gaming in Italy quite yet, ironically the very word Casino is derived from Latin, but the Jackpot bell is not ringing as loudly as it once did in Forti dei Marmi.